Seeing unicorns all over the place is not in itself a sign of a
bubble. But the fact that most companies are selling stock to the
public before they're able to make profits is worrying.

Lack of profits does not mean a company is dysfunctional. Plenty
of companies plough all their revenues, and investor capital,
back into their businesses in hopes of growing. In fact, an
extended period of non-profitability is more common than not in
early stage tech companies.

Nonetheless, the fact that only 11% of 127 companies going public
in 2014 were actually able to make money at the time suggests
that investors have become forgiving when it comes to new
companies with business models that are not yet fully proven out.